Under the terms of the deal, shareholders will receive $25.81 in cash for each share of Blue Coat common stock they hold, a premium of around 48 per cent based on Blue Coat’s closing price on Thursday. The high growth potential in cyber-security market, coupled with a downturn in traditional defence spending, have persuaded investors and military contractors to splash out on infosecurity firms in recent years.

Other notable deals include Intel’s $7.8bn acquisition of McAfee, which completed in February, and Apax Partners’ acquisition of Sophos last year.

The Blue Coat deal, which is subject to regulatory and shareholder approval, is expected to close in the first quarter of 2012.

Blue Coat started life as a caching specialist called CacheFlow before branching into web filtering and application delivery technology. It changed its name and made several acquisitions along the way. Evidence emerged last month that the the Syrian government used Blue Coat's technology to restrict internet access in the country.

The US has had trade embargoes against Syria since 2004. Blue Coat, which said it doesn't sell to Syria, said its products arrived in the country via a shipment it believed was bound for Iraq. The vendor has notified the US government, which is running an investigation into the matter. ®